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Summary and audio linked here.
Chicago’s political leadership is floating a pension buyout program as evidence it is seriously addressing the city’s thirty-six-billion-dollar unfunded pension liability, but Mark Glennon, founder of the Illinois policy research organization Wirepoints, said that the proposal moves debt from one column to another rather than reducing it, and that the broader fiscal picture facing the city continues to deteriorate across every measurable dimension. Audio here.
Expect no retraction or apology. This what they do.
The state’s existing buyout program for its own pensions is the precedent for Chicago, which should be a warning: Look out for similar exaggerated claims and shoddy analysis.
Full interview and summary linked here.
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One of the long-term fixes will be to tax the affluent more. Of course, that will have the opposite result than intended, since the affluent will then scoot. Also, do you notice how the lower income threshold to define “affluent” in Chicago and IL seems to keep lowering? I forgot to congratulate you on your new, elevated status to affluence! You’re so affluent, you won’t be able to retire at a reasonable age.
Pensions Answers will include da following;
How about renegotiating da golden public sector pensions that were stolen in supposed “fair” negotiations with city labor leaders and their masters the Illinois public sector unions.
IMO Illinoisans will start voting with their feet more and more as Pension Answers reality of ever increasing taxes starts to hit home.
Without a constitutional amendment that’s true. No real pension reform allowed, our court have said.
Who would you “renegotiate” with? Unions don’t have the power to negotiate lower benefits for retirees. These people aren’t even members of those unions anymore. Why would an individual pensioner ever give up rights to their own money? Whenever someone states “renegotiate” pension debt you know they have no idea the complexity of the situation.
The only choice is pay the pensions or seek bankruptcy protection where pensioners have historically done much better than everyone else.
There is always something to blow up the various “simple solutions” people seem to offer periodically, and you’re doing great here in pointing out the reasons why they are not simple at all. “Simple solutions” come from simple minds—only meaning those that simply don’t understand the quagmires of reasons and forces why they won’t happen at least until the magical silver-bullet solution hits that target.
The reality is that in my lifetime, much of IL will look entirely like East St. Louis, or Ford Heights, or Decatur, and there just won’t be enough money to pay the pensions as they come due. And the pensioners will scream and clutch their pearls that they *deserve* to be paid first, and they will stomp their little feet, and pout, but at the end of the day, that pension check is going to be smaller and arrive more erratically, and there’s nothing much they can do about it.
Well, that’s Possibility no. 1. But, since FDR’s time the nation has largely turned away from common fiscal restraints that governmental budgeting presumed to require. Now, governmental budgeting can be done with “funny money” which might bring other possibilities. That requires requires giving up some things to get other things. All you need is the right array of glittery other things to get it done.